Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
QUALITY CONTROL REVIEW PANEL
SUBJECT: New Mexico Human
Services Department
Docket No. A-94-168
Decision No. QC68
DATE: October 21, 1994
DECISION
The New Mexico Human Services Department (New Mexico)
appealed the
quality control (QC) redetermination of the
Regional Administrator of the
Administration for Children
and Families (ACF) in State QC review number
2737. New
Mexico contested ACF's finding that the newly born child
in the assistance unit did not meet the Aid to Families
with Dependent
Children (AFDC) eligibility requirements
for enumeration.
For the reasons discussed below, we conclude that the
child did meet the
eligibility requirements for
enumeration and that there is no QC error.
Statutory and Regulatory Provisions Relating to
Enumeration
Section 1137(a)(1) of the Social Security Act (Act)
provides that, as a
condition of eligibility for AFDC
payments under title IV-A of the Act, a
state shall
require that "each applicant for or recipient of benefits
.
. . furnish to the State his social security account
number . . .
." 1/ Regulations implementing this
requirement (commonly
referred to as the "enumeration
requirement") were issued in 1986.
Section 205.52 of
45 C.F.R. states in pertinent part that a state title
IV-A plan must
provide that --
(a) As a condition of eligibility, each applicant
for
or recipient of aid will be required:
(1) To furnish to the State or local agency a
social
security account number, hereinafter referred
to as the SSN . . . and
(2) If he cannot furnish a SSN (either because
such
SSN has not been issued or is not known), to
apply for such number through
procedures adopted by
the State or local agency with the Social Security
Administration. If such procedures are not in
effect, the
applicant or recipient shall apply
directly for such number, submit
verification or
such application, and provide the number upon its
receipt.
* * *
(c) The State or local agency will not deny,
delay, or
discontinue assistance pending the
issuance or verification of such numbers
if the
applicant or recipient has complied with the
requirements of
paragraph (a) of this section.
New statutory language relating to the enumeration
requirement was added
to title IV-A by the Omnibus
Reconciliation Act of 1989, which revised the
QC system
for payments made after fiscal year 1990. Section
408(c)(4) of the amended title IV-A states that --
[n]otwithstanding any other provisions of this
section, a payment
shall be considered an erroneous
payment if the payment is made to a family
. . . (b)
any member of which is a recipient of aid under a
State plan
approved under this part and does not
have a social security account number
(unless an
application for social security account number for
the family
member has been filed within 30 days
after the date of application for such
aid).
In October 1992, ACF issued Part 3539 of its Quality
Control Manual
(QCM), concerning the enumeration
requirement. That part identifies
three methods for
satisfying the enumeration requirement where an applicant
or recipient does not yet have a SSN: (1) the state may
have an
agreement with the Social Security Administration
(SSA) through which the
local agency accepts applications
for SSNs; (2) the local agency may refer
AFDC applicants
or recipients to the SSA district office to make direct
applications to SSA; or (3) a state may provide AFDC
applicants or
recipients with the Enumeration at Birth
(EAB) option. This last
option permits application for a
child's SSN through the hospital where the
child is born.
When an application for a SSN is made pursuant to the
EAB option, the recipient caretaker must verify the EAB
application to
the local agency and submit the SSN number
to the local agency.
Factual Background
The assistance unit in this case received an AFDC payment
of $373 for the
review month of August 1993. The payment
amount was determined based
on an assistance unit
composed of a mother (M.S.) and her three dependent
children. The dispute in this case involves the
enumeration status
of M.S.'s youngest child, B.S., who
was born on April 28, 1993 and added to
the AFDC budget
group on May 7, 1993. New Mexico Exhibit (Ex.) 1,
Attachments (Att.) 4 and 5.
M.S. applied for a SSN for B.S. while in the hospital
pursuant to the EAB
project. On April 30, 1993, when
M.S. applied for AFDC benefits for
B.S, she provided her
caseworker with a signed statement from the Medical
Records Clerk of the hospital confirming that M.S. had
applied for a SSN
through the EAB project. New Mexico
Ex. 1, Att. 5. This document
was placed in M.S.'s case
record.
On July 26, 1993, the caseworker sent M.S. a notice
advising her that the
she had not yet reported an SSN for
B.S. The caseworker asked M.S. to
contact her by August
9, 1993.
On August 2, 1993, M.S. went to a SSA office and filed a
second
application for a SSN for B.S. That same day,
M.S. took the
confirmation of this second application for
a SSN to her caseworker who put
it in M.S.'s case record.
New Mexico Ex. 1, Att. 4.
Also on August 2, 1993, SSA issued a SSN for B.S. by
mailing his Social
Security card to B.S. at his mother's
address. New Mexico Ex. 1, Att.
4. On August 13, 1992,
M.S. brought the Social Security card to her
caseworker.
The worker made a copy of the card and put the copy in
the case record. New Mexico Ex. 1, Att. 4. The
caseworker
then returned to M.S. the hospital
confirmation of B.S.'s birth and
application for a SSN
through the EAB project. Because the caseworker
had
copies of B.S.'s birth certificate and Social Security
card in the
case record, the caseworker believed the
hospital confirmation constituted
"duplication of
verification" under a state court settlement and should
be returned. 2/ New Mexico Ex. 1, Att. 5.
The next month, September 1993, this case was pulled for
QC review of the
correctness of the August 1993 payment.
Because the SSNs for all the
household members were in
the case record, the New Mexico QC reviewer
determined
the enumeration requirement was met. Subsequently, the
case was reviewed by ACF. The ACF QC reviewer, finding
that as of
the review date, August 1, 1993, there was no
evidence of a SSN or
application for a SSN in the file,
determined that B.S. did not meet the
enumeration
requirements and was ineligible. The ACF QC reviewer
therefore concluded there was a $57 overpayment error.
When New Mexico was notified of ACF's overpayment
determination, it
contacted M.S. and retrieved from her
the hospital confirmation of her EAB
application. New
Mexico then requested a reconsideration of the
overpayment determination by the Regional Administrator
and supplied him
with the hospital confirmation. New
Mexico Ex. 1, Att. 6. It
argued the hospital
confirmation established that, as of the review date,
the
file contained proof of an application for a SSN. The
Regional
Administrator sustained the finding of an
overpayment error on the grounds
that "no proof of
application was found in the file during the QC review."
New Mexico Ex. 2, Letter of Regional Administrator dated
June 8,
1994, at 4.
Discussion
The facts are undisputed in this case: M.S. applied for
a SSN for
her newborn child through the EAB project;
M.S. documented her EAB
application by submitting the
hospital's confirmation of an EAB application
to her AFDC
caseworker at the time she requested her child be added
to
her grant; the worker put the confirmation in the case
record where it
remained until after the review date,
August 1, 1993; and the worker
returned the confirmation
to M.S. when M.S. supplied the worker with B.S.'s
social
security card on August 13, 1993.
ACF based its error determination on the fact that the
case record, as
originally reviewed by ACF, contained
neither the hospital confirmation nor
any other evidence
that B.S. had applied for a SSN as of the review date,
August 1, 1993. ACF conceded that, had the hospital
confirmation
been in the case record, it would have been
"satisfactory evidence of the
enumeration requirement."
Response of ACF at 5.
As authority for its overpayment determination, ACF
relied on � 3539 of
the QCM which provides:
If evidence of application for an SSN is not present
and the
recipient has not yet received his/her SSN
as of the review date, an error
exists in the
element. If there is proof of application for an
SSN
in the case record and the recipient has not yet
received his/her number as
of the review date, no
error exists.
ACF concluded that this provision requires the evidence
of the
application of a SSN to be in the case record as
of the review date and as
of the time the case is
reviewed by the ACF QC reviewers.
New Mexico conceded that � 3539 required this case record
to contain
proof of a SSN application as of the review
date. However, New Mexico
argued that it should be able
to reconstruct the case record to reflect the
undisputed
fact that the hospital confirmation was in the case
record as
of the review date.
In view of the circumstances presented by this case, we
agree with New
Mexico for the following reasons. First,
under � 3539, the critical
issue in evaluating whether
the local agency applied the enumeration
standards
correctly is the contents of the case record as of the
review
date. Second, QC review procedures, as described
in the QC Manual, do
not preclude a state from submitting
additional documentation with its
reconsideration
request. Third, ACF does not dispute that the hospital
confirmation was in the file as of the review date and
that it satisfies
enumeration requirements. Each of
these reasons is discussed
below.
The primary purpose of QC review is to evaluate "the
accuracy with which
the local agency is applying AFDC
eligibility . . . requirements." QCM
� 3010. For the
enumeration eligibility requirement, � 3539 requires
certain evidence to be in the case record "as of the
review date."
In cases in which a SSN has not been
received "as of the review date," there
must be evidence
of an application in the case record "as of the review
date." 3/ The focus of � 3539 is therefore the
information the local agency had in the case record as of
the date the
local agency considered the recipient
eligible. Section 3539 does not
address the procedural
issue presented by the facts of this case: if a
critical
document is missing from the case record when it is
pulled for
review or reviewed by the ACF QC reviewers, is
a state precluded from
showing that "as of the review
date" the document was actually in the case
record?
The procedures for QC review are described in Appendix B
of the QCM,
which is titled "Resolving Differences
Between the Federal and State
Findings in the AFDC
Quality Control System." While it does not
explicitly
address the issue of whether a state may reconstruct a
case
record at the reconsideration level, it provides
that a state may submit
material to the Regional
Administrator and does not restrict that submission
to
material reviewed by the state and ACF QC reviewers.
As described by Appendix B, when the ACF QC staff
identify "differences,"
i.e., disagreements between state
and federal review findings that affect
the state's
official AFDC payment error rate, they notify the state
by
sending it a difference letter. The state may then
request
reconsideration of the difference by the Regional
Administrator. The
reconsideration request must "include
necessary justification (reasoning to
support the State's
position) and appropriate supporting
documentation."
Appendix B at 2. The Regional Administrator then
is to
"re-evaluate the Federal finding in light of the material
submitted by the State . . . ." Id. "If the
justification
for the reconsideration request is
insufficient or is not supported with
sufficient
documentation, the original difference finding will be
sustained." Id. Thus, the QC manual contains no
explicit or
even implicit proscription of new evidence
during the reconsideration
stage. 4/
Further, allowing a state to supplement the record during
reconsideration
is consistent with the purpose of QC:
evaluating the accuracy with
which the local agency is
applying AFDC eligibility requirements. The
reconsideration level is the first opportunity a state
has to respond to
findings of the ACF QC reviewers.
Where the ACF QC reviewers identify
a potential error
that state reviewers did not find, as happened in this
case, the process should allow a state to respond fully
so that both
parties can evaluate whether there has been
an error. 5/
Restricting the information a state could
use in its response would lead to
situations like the one
presented here: review of a local agency's
decision
without the documents or information the agency had at
the time
the decision was made.
Finally, while ACF is reasonable in assuming, as a
general rule, that the
contents of the case record when
it is pulled for QC review will accurately
reflect its
contents as of the review date, there are circumstances
in
which the undisputed facts contradict such an
assumption. This case
presents such circumstances: New
Mexico has been able to recover the
actual document at
issue; ACF does not dispute that this document was in the
case record on the review date; and ACF agrees that the
document
satisfies enumeration requirements.
Therefore, in view of the absence of any dispute as to
the contents of
the case record on the review date, we
conclude that it would be
inconsistent with the purpose
of QC review to preclude the State from
reconstructing
the file and from relying on the hospital confirmation.
As acknowledged by ACF, the hospital confirmation
satisfies the
requirements of QCM � 3539. Consequently,
B.S. met all eligibility
requirements for enumeration and
there was no overpayment.
Conclusion
For the reasons discussed above, we conclude that the
$373 payment made
to M.S. on August 1, 1993 was correct.
Accordingly, we reverse ACF's
determination.
__________________________
Thomas
D. Horvath
___________________________
Leslie
A. Weyn
___________________________
Sara
Anderson
* * * Footnotes * * *
1. This provision is part of
comprehensive requirements
for an Income and Eligibility Verification System
which became
effective April 1, 1985. Prior to that date, section
402(a)(25)
required an AFDC applicant or recipient to furnish a Social
Security Number as a condition of eligibility for title IV-A
payments.
2. The parties refer to this settlement as
"the Hatten and
Gonzales court agreement." It apparently
had to do with duplication of
verification in processing
AFDC applications. See New Mexico Ex. 2,
Regional
Administrator's letter dated June 8, 1994 sustaining the
error
determination at 3; New Mexico Ex. 2, Regional
Administrator's letter dated
November 27, 1990 concerning
QC review under the settlement. In this
case, New Mexico
is not arguing that the worker's return of the hospital
confirmation was actually required by the settlement.
Brief of New
Mexico at 8. Since New Mexico is not
relying on the settlement, its
terms are irrelevant here.
3. ACF agrees that the term "as of the review
date"
modifies "evidence of an application." Unless �
3539 is read this way,
the August 2, 1993 letter from SSA
saying that B.S. had applied for a SSN
would satisfy it:
the August 2 letter would be evidence of an
application
for a SSN in a case in which the recipient did not have a
SSN as of the review date. However, since the August 2
letter
postdates the review date by one day, it does not
satisfy the requirements
of � 3539.
4. We explicitly note that in a case such as
this, where
the case record during QC review does not
accurately reflect its contents as
of the review date, it
is a state's affirmative responsibility to obtain the
missing evidence and to offer a credible explanation for
the
discrepancy. Further, ACF is under no duty to
inquire as to the
possibility of such a
discrepancy.
5. Construing the reconsideration process to
include an
opportunity for a state to present new
evidence to the Regional
Administrator also is consistent
with the history of QC regulations
implementing QC
provisions of the Omnibus Budget Reconciliation Act of
1989. In its notice of proposed rule making, ACF limited
a state's
appeal under 42 C.F.R. � 205.42(i)(5) to the
Quality Control Review Panel to
issues raised during its
prior appeal to the Regional Administrator.
56 F.R.
27,709 (1991). ACF deleted this limitation from the
final
QC regulations after many commentators objected
because "the statute
provides no such limitation." 57
F.R. 46,798 (1992). In
modifying the proposed
regulation, ACF affirmed that the QC review process
should be open and flexible so that an informed decision
can be made on
whether a state has made an error. (We
expressly note that nothing in
this decision addresses
the question of the type of evidence a state may
submit
to the Quality Control Review Panel.)
(..continued)
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